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Are there some servicing actions that must receive prior approval by SBA?
Yes. Title 13 of the Code of Federal Regulations §120.536 lists the following servicing actions that require SBA’s prior written consent:
- Increases to the principal amount of a loan above that authorized by SBA at loan origination.
- Any action that confers a Preference on the Lender or CDC or engages in an activity that creates a conflict of interest.
- Compromises on the principal balance of a loan.
- Taking title to any property in the name of SBA.
- Taking title to environmentally contaminated property, or taking over operation and control of a business that handles hazardous substances or hazardous wastes.
- Transfers, sells or pledges of more than 90% of a loan.
- Any action for which prior written consent is required by a Loan Program Requirement.